Core Insights - Both Alibaba and Meituan reported significant losses in their recent Q3 financial results, indicating a fierce competitive landscape in the Chinese e-commerce and food delivery markets [2][3] - Alibaba's adjusted EBITA dropped from 443 billion RMB to 105 billion RMB year-on-year, while Meituan's revenue was 955 billion RMB with an operating loss of 141 billion RMB and an adjusted net loss of 160.1 billion RMB, compared to a net profit of 128.29 billion RMB in the same period last year [2][3] - The cash burn for both companies exceeded 300 billion RMB in Q3, with Alibaba's cash reserves allowing for a lower percentage of cash burn compared to Meituan, highlighting an asymmetrical battle [2][3] Financial Performance - Alibaba's Q3 revenue for its China e-commerce group was 114.77 billion RMB, a 16% increase year-on-year, while Meituan's revenue was 955 billion RMB, reflecting the ongoing competition in the market [7] - The adjusted net loss for Meituan in Q3 was 160.1 billion RMB, a stark contrast to the previous year's adjusted net profit of 128.29 billion RMB [2][3] Market Dynamics - The market share for food delivery services has not reverted to previous levels despite the cessation of subsidies, indicating a shift in consumer behavior and market dynamics [3] - The competitive landscape is evolving, with new players like Douyin (TikTok) entering the local commerce space, further intensifying the competition [3] Strategic Developments - Alibaba's strategy has shifted towards a more focused approach, consolidating its resources under the "all in one" strategy, which aims to enhance operational efficiency and user engagement [8] - The company is actively investing in its instant retail segment, with a clear roadmap to expand scale, improve efficiency, and optimize product offerings [15][17] User Behavior Changes - The concept of "good loss" is emerging, where losses are seen as investments in long-term user habits and market positioning, similar to Amazon's strategy during its growth phase [9][10] - Instant retail is expected to create irreversible changes in consumer habits, with Alibaba's efforts in this area driving significant increases in active users and revenue growth [12][14] Competitive Outlook - The ongoing battle between Alibaba and Meituan is characterized by aggressive strategies from both sides, with Alibaba's investments in instant retail putting pressure on Meituan's market share and profitability [17] - The competition is likely to remain intense, with both companies adapting to the evolving market landscape and consumer preferences [17]